Immigrant's Characteristics and its different effects on bilateral trade
AbstractThis paper tests for the impact of immigration on bilateral trade using Spanish data from 1995 to 2003. It also explores some possible mechanisms through which the stock of immigrants in a country can contribute to its trade. It uses a gravity equation for trade augmented with an immigrants stock variable and a set of control variables. The immigrants variable enters the estimated equation in different ways depending on immigrant relevant characteristics. Results show that there is a positive link between immigration and both exports and imports. We find evidence for the trade transaction cost channel but not for the preference one. We find evidence that support that the mechanisms behind this link are the information effect - additional information about product and about social and political institutions brought by immigrants - and the social o ethnic network effect - since immigrants with a medium level of education and those who are related to business activities are the one who have a positive effect on bilateral trade.
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Bibliographic InfoPaper provided by FEDEA in its series Working Papers on International Economics and Finance with number 05-09.
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Other versions of this item:
- José Vicente Blanes-Cristóbal, 2005. "Immigrant’s Characteristics and its different effects on bilateral trade," Working Papers 05-09, Asociación Española de Economía y Finanzas Internacionales.
- F10 - International Economics - - Trade - - - General
- F22 - International Economics - - International Factor Movements and International Business - - - International Migration
This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-01-24 (All new papers)
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